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Showing 141 to 160 of 879 Records
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2010 (1) TMI 1175
Deduction u/s 80IA - Interest income earned on margin money deposited with the bank for obtaining Letter of Credits [LCs] - assessee has been purchasing raw-materials and banks required the assessee to make deposits for covering the amount of LCs - AO noted that the assessee has two units; one is General Unit which is entitled to deduction u/s 80IA @ 30% whereas the other Unit called Captive Power Plant [CPP] unit which is entitled to 100% deduction u/s 80IA.
AO held that interest income is not entitled to deduction u/s 80IA in view of the decision of the Hon'ble Supreme Court in the case of Pandian Chemicals Ltd. vs. CIT[2003 (4) TMI 3 - SUPREME COURT].
HELD THAT:- This issue has been decided by the Tribunal in favour of the assessee in the AY 2001-02 relying on the decision in the case of Karnal Co-operative Sugar Mills Ltd. [1999 (4) TMI 7 - SC ORDER] held that so far as interest received on opening of Letter of Credit is concerned, the same falls within the definition of “profits and gains derived by an undertaking or an enterprise from any business”, as referred to in sub-section (4) of section 80IA and, therefore, entitled to deduction u/s 80IA. Respectfully following the judgment, we decide the issue in favour of the assessee. Accordingly, this ground of the assessee is allowed.
Deducting loss incurred in the General Unit against the income derived by CPP Unit - AO reduced the loss incurred in General Unit against the income earned in CPP Unit and thereby reduced the available deduction u/s 80IA in CPP Unit - HELD THAT:- This issue has been decided against the assessee by the Tribunal in AY 2001-02. Relying on the latest decision of Hon'ble Supreme Court in the case of Synco Industries Ltd. [2008 (3) TMI 13 - SUPREME COURT] held that gross total income of the assessee has first got to be determined after adjusting losses etc., and if the gross total income of the assessee is "nil" the assessee would not be entitled to" deductions under Chapter VI-A - This ground of the assessee is rejected.
Deduction u/s 80IA - adjustment of electricity price charged by CPP Unit from General Unit - CPP Unit is generating electricity and supplying to General Unit as well as other consumers. CPP Unit charged rate at ₹ 5.40 paise per unit from General Unit whereas the AO restricted the same to ₹ 5.32 paise per unit and accordingly restricted the deduction u/s 80IA - HELD THAT:- In the case of ACIT vs. Jindal Steel & Power Ltd.[2007 (6) TMI 308 - ITAT DELHI] held that the market rate postulated by section 80IA(viii) shall be the price at which the assessee purchases electricity from the Electricity Board. Respectfully following the decision, we hold that the market value for electricity would be the one at which it is supplied by GEB to other assessees inclusive of duty. Therefore, the rates taken by the assessee for the purpose of supplying electricity from CPP Unit to General Unit is upheld. The assessee succeeds on this point.
Netting of interest income against the expenditure - assessee has earned interest on deposits made with the banks for opening LCs. It has also incurred an expenditure on loan borrowed for the purpose of business - HELD THAT:- Once interest income earned from fixed deposits kept with the bank in respect of margin money for availing LC facilities would be business income as per our decision for the Assessment Year 2002-03 and thereafter any interest spent on earning such interest income would be reduced. For the purpose of finding out the nexus of interest expenditure with the interest income earned on margin money kept with the bank for availing LC facilities and thereafter doing netting, we restore the matter to the file of the AO. We make it clear that the onus is on the assessee to establish the nexus of interest income earned with the particular Unit and thereafter netting of interest expenditure with the interest income earned in respect to that Unit. AO after making necessary verification allow netting. This ground of assessee is allowed but for statistical purpose.
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2010 (1) TMI 1174
Issues Involved:1. Deduction under Section 10B of the Income Tax Act. 2. Addition on account of lower Gross Profit (G.P.). Issue-wise Detailed Analysis:1. Deduction under Section 10B of the Income Tax Act:Facts: The assessee, engaged in the manufacture of 2.2-Dithio-di benzoic acid, claimed a deduction under Section 10B of the Income Tax Act for its export-oriented unit. The Assessing Officer (AO) denied this deduction, arguing that the assessee was not a new industrial undertaking and had previously claimed deductions under Section 80HHC. The AO contended that Section 10B benefits were only available to new undertakings and that the assessee's unit was a conversion of an existing unit, thus not qualifying for the deduction. Assessee's Arguments: The assessee argued that all machinery and equipment were newly purchased and installed for manufacturing purposes. They further contended that the unit was approved by the government as a new export-oriented unit (EOU) and had not used any previously used machinery or plant. The assessee also highlighted that the letter of permission issued by the Ministry of Commerce & Industry was sufficient compliance for claiming the deduction under Section 10B. Findings of CIT(A): The CIT(A) allowed the claim, stating that the unit was formed as a new unit in 1991 with new machinery and had not been formed by splitting up or reconstruction of an existing business. The CIT(A) further observed that the intention of the legislature was to provide benefits to EOUs similar to those in Free Trade Zones, and existing units availing benefits under Section 80HHC could also avail of Section 10B benefits if they obtained an EOU certificate. The CIT(A) concluded that the assessee's unit, being a new unit at the time of formation and obtaining EOU status later, was eligible for the deduction under Section 10B for the unexpired period of ten years from the date it started manufacturing. Tribunal's Decision: The Tribunal upheld the CIT(A)'s findings, agreeing that the unit was new at the time of formation and had used only new machinery. The Tribunal noted that the legislative intention was to extend benefits to EOUs, and the assessee's unit, having obtained an EOU certificate, was entitled to the deduction under Section 10B for the unexpired period of ten years. The Tribunal dismissed the Revenue's appeal on this ground. 2. Addition on account of lower Gross Profit (G.P.):Facts: The AO noticed a significant decline in the assessee's net profit percentage compared to previous years and questioned the valuation of closing stock and discrepancies in export sales. The AO suspected price rigging and siphoning off profits, leading to an addition based on an estimated net profit rate of 9% on sales. Assessee's Arguments: The assessee explained that the financial year in question was a bad year for profitability due to factors such as exchange rate fluctuations, higher costs, and lower sales prices. The assessee provided detailed explanations and evidence, including a comparative chart and industry data, to support their claims. Findings of CIT(A): The CIT(A) found that the AO did not provide specific findings on the discrepancies in closing stock and sales and accepted the assessee's explanations. The CIT(A) noted that the decline in profits was due to genuine factors such as exchange rate fluctuations, increased costs, and lower sales prices. The CIT(A) also observed that the AO did not point out any specific defects in the books of accounts and had based the addition on mere suspicion and estimation without concrete evidence. The CIT(A) deleted the addition, stating that the AO had not justified the rejection of the book results or the estimation of profits. Tribunal's Decision: The Tribunal upheld the CIT(A)'s findings, agreeing that the AO had not provided sufficient evidence to justify the addition. The Tribunal noted that low profit in a particular year, by itself, does not justify an addition without supporting material. The Tribunal emphasized that the AO must provide specific reasons and evidence for rejecting the book results and making an estimated addition. The Tribunal dismissed the Revenue's appeal on this ground. Conclusion:The Tribunal dismissed the Revenue's appeal, upholding the CIT(A)'s decision to allow the deduction under Section 10B and to delete the addition on account of lower gross profit. The Tribunal emphasized the importance of concrete evidence and specific findings in making additions and rejecting book results. Order pronounced on this day of 29th January, 2010.
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2010 (1) TMI 1173
Issues Involved:
1. Interest-bearing funds diverted to interest-free funds for sister concerns.
2. Advances or loans given to sister concerns out of commercial expediency.
3. Disallowance of interest at 12% instead of 9% charged by the appellant.
4. Taxation of real income versus notional income.
5. Breach of law and Principles of Natural Justice.
6. Levying interest u/s 234B/C/D of the Act.
7. Initiation of penalty proceedings u/s 271(1)(c) of the Act.
Summary:
1. Interest-bearing funds diverted to interest-free funds for sister concerns:
The learned CIT(A) confirmed the AO's decision that the appellant diverted interest-bearing funds to sister concerns without charging interest. The AO disallowed interest at 15% for M/s Kinariwala RJK Industries and 6% for M/s Utkarsh Fincap Pvt. Ltd. and M/s Kinariwala Spinners.
2. Advances or loans given to sister concerns out of commercial expediency:
The appellant argued that advances to sister concerns were out of commercial expediency and for business purposes. The learned CIT(A) rejected this, stating the appellant did not prove that funds advanced were from interest-free capital.
3. Disallowance of interest at 12% instead of 9% charged by the appellant:
The appellant contended that the balances with M/s Kinariwala RJK Industries were old trade balances, and no new money was advanced. For the other two parties, the appellant claimed sufficient interest-free capital to cover the advances. The Tribunal found the appellant's argument valid, noting the Revenue failed to show the funds were from interest-bearing borrowed capital.
4. Taxation of real income versus notional income:
The appellant argued that only real income should be taxed, not notional income. The Tribunal agreed, citing the Supreme Court's decision in S A Builders vs. CIT, which supports no disallowance of interest if the advances are for business purposes.
5. Breach of law and Principles of Natural Justice:
The appellant claimed the lower authorities ignored submissions and explanations, breaching the Principles of Natural Justice. The Tribunal did not specifically address this issue but ruled in favor of the appellant based on the merits of the case.
6. Levying interest u/s 234B/C/D of the Act:
The learned CIT(A) upheld the AO's action of levying interest u/s 234B/C/D. The Tribunal did not specifically address this issue in the judgment.
7. Initiation of penalty proceedings u/s 271(1)(c) of the Act:
The learned CIT(A) upheld the initiation of penalty proceedings u/s 271(1)(c). The Tribunal did not specifically address this issue in the judgment.
Conclusion:
The Tribunal ruled in favor of the appellant, finding that the Revenue failed to prove the nexus between interest-free advances and interest-bearing borrowed funds. The appeal by the assessee was allowed.
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2010 (1) TMI 1172
Issues involved: Appeal against penalty imposed u/s 271(1)(c) of the Income Tax Act, 1961 for the assessment year 2003-04.
Summary:
1. Background and Appeal:
The taxpayer filed an appeal against the penalty of Rs. 1,51,28,982 imposed u/s 271(1)(c) for the assessment year 2003-04, which was upheld by the Commissioner (Appeals).
2. Tribunal's Decision:
The Tribunal noted that related quantum additions had been restored to the Assessing Officer for fresh consideration by a coordinate bench. The taxpayer argued that since the Tribunal did not approve the quantum additions, the basis for the penalty ceased to exist. The Tribunal agreed, stating that the foundation of the penalty ceases to exist when additions are disapproved and remitted for reconsideration.
3. Authority to Initiate Penalty Proceedings:
The Tribunal clarified that the Assessing Officer or the CIT(A) could initiate penalty proceedings again if they deemed it appropriate after confirming the quantum additions wholly or partly. The decision to initiate penalty proceedings must be based on a separate assessment of whether it is a fit case for penalty, even if the quantum additions are reiterated.
4. Conclusion:
Considering the legal position and factual matrix, the Tribunal held that the penalty should be deleted as the basis for the penalty no longer existed. The Tribunal allowed the appeal and deleted the penalty of Rs. 1,51,28,982 imposed on the taxpayer.
Judges:
- Shri Pramod Kumar, Accountant Member
- Shri R.S. Padvekar, Judicial Member
Legal Representatives:
- For the Petitioner: Shri A.V. Sonde and Shri Ketan Ved
- For the Respondent: Shri Ajit Srivastava and Shri M.B. Reddy
Date of Judgment: 6th January 2010
Citation: 2010 (1) TMI 1172 - ITAT MUMBAI
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2010 (1) TMI 1171
Issues involved: Addition of unexplained cash credit u/s 68.
Issue: Addition of unexplained cash credit u/s 68.
The appellant, an individual, declared a total income and claimed exemption u/s 54F for long term capital gains from the sale of shares. The Assessing Officer treated the transactions as bogus, adding the sale consideration to the total income u/s 68. The CIT (A) upheld this decision. The Tribunal referred to a similar case where such additions were deleted due to lack of evidence and application of mind by the Assessing Officer. The Tribunal ruled in favor of the appellant, deleting the addition u/s 68 and directing a review of the exemption claim u/s 54F.
Decision:
The Tribunal ruled in favor of the appellant, deleting the addition u/s 68 and directing a review of the exemption claim u/s 54F.
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2010 (1) TMI 1170
Issues involved: Duty demand against M/s. Urbane Industries, penalty on capital goods, penalty on Managing Partner
Duty demand against M/s. Urbane Industries:
The Commissioner of Central Excise confirmed a duty demand of &8377; 51,29,017 against M/s. Urbane Industries by clubbing the clearances of two dummy units with those of M/s. Urbane Industries. The Tribunal found merit in the contention that principles of natural justice were violated due to the non-issuance of show-cause notice to the dummy units, CTGC and GCC. Citing precedents like Ogesh Industries Vs. CCE, the Tribunal set aside the demand and penalties related to clubbing, directing a fresh decision after issuing show-cause notices to CTGC and GCC.
Penalty on capital goods:
The appellants did not dispute the demand of &8377; 1,54,396 related to capital goods, and the Tribunal upheld this demand along with the penalty of equal amount.
Penalty on Managing Partner:
A penalty of &8377; 10 lakhs was imposed on Shri R. Krishna Mohan, the Managing Partner of M/s. Urbane Industries. However, this penalty was set aside by the Tribunal along with the penalties related to the clubbing issue, emphasizing the need for adherence to principles of natural justice.
In conclusion, the appeals were partly allowed by the Tribunal, with the decision to set aside the demand and penalties related to clubbing, and the penalty imposed on the Managing Partner. The issue of clubbing was remitted for a fresh decision after show-cause notices were issued to the relevant dummy units.
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2010 (1) TMI 1169
Issues Involved:1. Condonation of delay in filing the appeal. 2. Charging of interest u/s 234B and 234C without adjusting advance tax and self-assessment tax from the PD account. 3. Charging of interest u/s 234A. Summary:Issue 1: Condonation of Delay in Filing the AppealThe assessee argued that the delay in filing the appeal was due to receiving wrong legal advice and health issues. The CIT(A) dismissed the appeal in limine without considering the merits. The Tribunal, referencing the Supreme Court's decision in Collector, Land Acquisition vs. Mst. Katiji & Ors., held that the CIT(A) should have adopted a liberal approach and condoned the delay to ensure substantial justice. Therefore, the Tribunal found the CIT(A) erred in not admitting the appeal and deciding it on merits. Issue 2: Charging of Interest u/s 234B and 234CThe assessee contended that the AO charged interest u/s 234B and 234C without adjusting the advance tax and self-assessment tax from the amount lying in the PD account, despite specific requests. The Tribunal admitted this legal ground, citing the Supreme Court's decision in National Thermal Power Co. Ltd. vs. CIT, which allows raising new legal grounds if they arise from facts on record. The Tribunal referenced the Delhi High Court's decision in CIT vs. K.K. Marketing, which held that the Department should adjust seized cash against advance tax liability. Consequently, the Tribunal directed the AO to adjust the amounts as requested by the assessee and recalculate the interest accordingly. Issue 3: Charging of Interest u/s 234AFor the asst. yr. 2007-08, the assessee argued that interest u/s 234A was wrongly charged as the return was filed before the due date. The Tribunal admitted this legal ground and found that since the return was filed on 29th Oct., 2007, before the due date of 31st Oct., 2007, no interest u/s 234A should be charged. The Tribunal directed the AO to adjust the advance tax liability and recalculate the interest, if any. Conclusion:The Tribunal allowed the appeals partly, directing the AO to adjust the advance tax and self-assessment tax from the PD account and to recalculate the interest u/s 234B, 234C, and 234A accordingly.
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2010 (1) TMI 1168
The Supreme Court dismissed the Civil Appeal while keeping the question of law open. Delay was condoned.
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2010 (1) TMI 1167
Exemption- Notification No. 89/95-C.E.- The respondents are manufacturers of edible vegetable refined oil and vanaspathi falling under sub-heading Nos. 1508/1510/1512/1516 etc., of the Central Excise Tariff, the respondents procure crude vegetable oil from various sources and convert/process the: same into refined vegetable edible oils and vanaspathi - the decision in the case of COMMISSIONER OF C. EX., HYDERABAD Versus PRIYANKA REFINERIES LTD. [2009 (5) TMI 419 - CESTAT, BANGALORE] contested, where it was held that the soap stock which arises/emerges during the refining of vegetable oil is a waste for the respondents, though the Revenue may call it as a by-product. Accordingly, on merits as well as on the law, the Revenue (Appeals) is devoid of merits - Held that: - the decision in the case of COMMISSIONER OF C. EX., HYDERABAD Versus PRIYANKA REFINERIES LTD. upheld - appeal dismissed - decided against Revenue.
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2010 (1) TMI 1166
Issues involved:
The judgment involves the imposition of penalty on the assessee under Section 15-A(1) (o) of the U.P. Trade Tax Act for the Assessment Year 2002-03, based on the order of the Tribunal dated 28th of March, 2006.
Issue 1: Justification of penalty imposition based on previous judgments
The questions of law framed include whether the imposition of penalty is justified based on previous judgments such as M/s Network Limited, Noida v. Commissioner Trade Tax, Commissioner Sales Tax v. Jaipur Golder Transport Co., Central Footwear Varanasi v. Commissioner Sales Tax, and Commissioner Sales Tax v. Micro Foam Industries Limited.
Issue 2: Justification of penalty imposition despite filing Form 31
The issue arises as to whether the levy of penalty is justified even though Form 31 was filed along with the reply to show cause notice before the seizure.
Issue 3: Justification of penalty imposition based on additional judgments
Another question is whether the imposition of penalty is justified in light of judgments like M/s Kalyan Plastic Industries v. Commissioner Sales Tax, DCM Limited v. Commissioner Sales Tax, Commissioner Sales Tax v. M/s Garg Associates Pvt. Limited, and M/s WIMCO Limited v. Commissioner Sales Tax.
Issue 4: Import of goods as raw material and penalty imposition
The matter questions whether the penalty imposition is justified if the goods were imported as raw material and not meant for resale, and if the goods were imported against form 'C' with relevant entries duly made in the books of accounts.
Issue 5: Penalty imposition for goods imported through Bank
It is raised whether the authorities were justified in imposing a penalty when the goods were being imported through a Bank.
Issue 6: Overall justification of penalty amount
Lastly, the question is posed whether, in any view of the matter, the imposition of a penalty of Rs. 1,27,206 is justified.
Issue 7: Validity of the Trade Tax Tribunal's order
Considering the facts and circumstances of the case, the query is whether the order passed by the Trade Tax Tribunal is justified.
The judgment details the case where the assessee placed a purchase order for H.R. Coils from M/s ESSAR Steels Limited, New Delhi, and imported the raw material to NOIDA. Despite the submission of Form-31 along with a detailed reply to the show cause notice, the raw material was found unsupported by Form-31 upon inspection. Consequently, a penalty was imposed under Section 15A(1) (o) of the U.P. Trade Tax Act, which was upheld in the lower appeals.
Upon review, the High Court found that the Forms-31 submitted by the assessee were not false or forged, and no discrepancy was found in the Forms-31 produced before the seizure order. As a result, the Court concluded that the imposition of penalty was not justified as there was no intention to evade tax reflected in the documents. Therefore, the penalty was deleted, and the revision was allowed.
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2010 (1) TMI 1165
Issues Involved:
1. Whether the criminal proceedings against the petitioner can be quashed based on the exoneration by CEGAT.
2. Whether the findings in adjudication proceedings affect the criminal prosecution.
3. Applicability of Article 20(2) of the Constitution and the rule of estoppel in the context of customs violations.
4. The independence of adjudication and prosecution proceedings under the Customs Act.
Issue-Wise Detailed Analysis:
1. Whether the criminal proceedings against the petitioner can be quashed based on the exoneration by CEGAT:
The petitioner argued for quashing the criminal complaint under Section 135 of the Customs Act based on his exoneration by CEGAT. The court referred to the Supreme Court's decision in "Standard Chartered Bank vs. Directorate of Enforcement," which held that adjudication and prosecution are independent proceedings. The court emphasized that a finding in favor of the accused in adjudication proceedings does not automatically entitle them to quashing of criminal proceedings. The court stated, "There is nothing in the Act to indicate that a finding in an adjudication is binding on the court in a prosecution under Section 56 of the Act."
2. Whether the findings in adjudication proceedings affect the criminal prosecution:
The court highlighted that the adjudication proceedings and criminal prosecution serve different purposes and are independent of each other. The Supreme Court's decision in "Assistant Collector of Customs vs. L.R. Malwani" was cited, which clarified that adjudication before a Collector of Customs is not a "prosecution" and does not constitute a "verdict of acquittal." The court reiterated, "The criminal court has to judge the case independently on the evidence placed before it."
3. Applicability of Article 20(2) of the Constitution and the rule of estoppel in the context of customs violations:
The court addressed the applicability of Article 20(2) of the Constitution, which prevents double jeopardy. It was clarified that proceedings before the Collector of Customs are not criminal trials and therefore do not invoke Article 20(2). The court also referred to the rule of estoppel, stating that it does not apply as the adjudication proceedings are not equivalent to a criminal trial. The court noted, "Neither the Adjudicating Officer nor the Tribunal is a 'Court,' and therefore, neither bar of Article 20(2) of the Constitution applies to the prosecution despite the view taken in adjudication proceedings."
4. The independence of adjudication and prosecution proceedings under the Customs Act:
The court emphasized the independence of adjudication and prosecution under the Customs Act. The decision in "P. Jayappan Vs. S.K. Perumal" was referenced, which held that criminal proceedings should be judged independently of adjudication results. The court also noted that the Tribunal's decision does not bind the department, stating, "The view taken by the Tribunal cannot be said to be the view of the department and, therefore, does not bind it."
Conclusion:
The court concluded that the criminal proceedings against the petitioner could not be quashed solely based on the exoneration by CEGAT. The petition was dismissed, reinforcing that adjudication and prosecution are independent processes, and findings in one do not automatically influence the other. The court stated, "There is no valid ground warranting quashing of the criminal complaint filed by the respondent against the petitioner."
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2010 (1) TMI 1164
Issues involved: Interpretation of Section 158BC of the Income Tax Act, 1961 in the context of block assessment proceedings based on a search conducted on a taxpayer.
Summary:
1. The Revenue appealed against the Tribunal's decision to delete an addition of Rs. 57,53,250 (actual addition in AO is Rs. 53,57,796) u/s 158BC of the Income Tax Act, 1961. The issue arose from credit balances of sundry creditors reflected in the assessee's balance sheet for Assessment Year 2002-03, which were also part of the regular return filed by the assessee.
2. The Tribunal noted that the credit balances in question were part of the regular return filed by the assessee and were not undisclosed income found as a result of the search. The assessing officer identified certain sundry creditors as bogus due to lack of confirmatory letters, but the CIT (Appeals) and Tribunal ruled in favor of the assessee, stating that these amounts could not be part of the block assessment as they were already disclosed in the regular return.
3. The High Court upheld the Tribunal's decision, emphasizing that the credit balances of sundry creditors were part of the regular return filed by the assessee for the relevant assessment year. Therefore, these amounts could not be included in the block assessment u/s 158BC as they were not undisclosed income discovered during the search.
4. The Court concluded that the appeal did not raise any substantial question of law and dismissed it accordingly.
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2010 (1) TMI 1163
... ...
... ... ..... for the appellant. Delay condoned. The civil appeal is dismissed.
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2010 (1) TMI 1162
Issuance of SCN - Recovery of erroneous refund - Principles of restitution - the order granting refund is reversed by the higher forum, whether issuance of SCN u/s 11A was necessary? - Held that: - reliance placed on the judgment in the case of Commissioner of C.Ex.,Shilong Vs. Woodcraft Products Ltd. [2002 (4) TMI 76 - SUPREME COURT OF INDIA] where the Supreme Court has ruled that on the principle of restitution no such notice was necessary - no substantial question of law is involved in the present appeal - Appeal is thus dismissed in limini.
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2010 (1) TMI 1161
Issues Involved:
1. Disallowance of claim of deduction u/s 80HH, 80-I, and 80-IA.
2. Disallowance of expenditure incurred on horticulture.
3. Disallowance on account of amortizing the cost of land.
4. Disallowance of investment allowance claimed on additional cost of plant & machinery.
5. Disallowance u/s 43B.
6. Addition on account of interest and miscellaneous income.
7. Disallowance of interest expenditure alleged to be pertaining to the prior period.
Summary:
1. Disallowance of claim of deduction u/s 80HH, 80-I, and 80-IA:
The assessee's appeals for AY 1997-98, 1998-99, and 1999-2000 involved common grounds regarding the disallowance of deductions u/s 80HH, 80-I, and 80-IA. The Tribunal had previously restored similar issues to the AO for fresh consideration in earlier assessment years. Following this precedent, the Tribunal restored the matter back to the AO for fresh adjudication.
2. Disallowance of expenditure incurred on horticulture:
The AO had disallowed horticulture expenditure as capital in nature. The Tribunal, following its earlier order for AY 1996-97, restored the issue back to the AO for fresh examination, directing the AO to give due opportunity to the assessee.
3. Disallowance on account of amortizing the cost of land:
The Tribunal confirmed the lower authorities' decision that the cost incurred for land is capital in nature and no depreciation is allowable. Thus, there is no question of allowing amortization of such cost.
4. Disallowance of investment allowance claimed on additional cost of plant & machinery:
The AO declined the claim for investment allowance on additional costs incurred for plant & machinery. The Tribunal, referencing the Hon'ble Supreme Court's decisions in similar cases, restored the matter back to the AO to verify the facts and recompute the eligible amount of investment allowance.
5. Disallowance u/s 43B:
The AO disallowed Rs. 1,70,09,450/- u/s 43B, treating the productivity-linked incentive as bonus. The Tribunal held that such incentive is not covered by u/s 36(1)(ii) and directed the AO to verify the actual date of payment and allow the same if paid before the last date of filing the return.
6. Addition on account of interest and miscellaneous income:
The AO taxed interest and miscellaneous income related to projects under implementation as income from other sources. The Tribunal, applying the Hon'ble Supreme Court's decisions in Bokaro Steels and Karnal Cooperative Sugar Mills, held that such income should reduce the capital work in progress and cannot be assessed as income from other sources.
7. Disallowance of interest expenditure alleged to be pertaining to the prior period:
The AO disallowed Rs. 13,07,71,000/- as prior period interest expenditure. The Tribunal restored the matter back to the AO for fresh consideration, directing the assessee to provide documentary evidence and the AO to verify the assessment particulars for AY 2007-08.
Decision:
The appeals of the assessee for all the years were allowed in part, with directions for fresh adjudication by the AO on several issues. Decision pronounced in the open Court on 22nd January, 2010.
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2010 (1) TMI 1160
Issues involved: Confirmation of demand of irregular rebate, imposition of penalty, remand of the matter for separate liability determination.
Confirmation of demand of irregular rebate and penalty imposition:
The Commissioner confirmed the demand of irregular rebate amounting to Rs. 1,24,19,869 from the appellant and six others, along with imposition of interest and penalty. The penalty was imposed jointly and severely on all seven beneficiaries. The advocate representing the appellant argued that the penalty should be imposed separately on each individual. The Tribunal had previously remanded a similar case to the Original Adjudicating Authority for fresh decision and fixing liability on each individual separately. Since the demand for rebate and penalty was not imposed separately on the appellant, it was deemed necessary to remand the matter for separate determination of liability.
Request for supply of relied upon documents:
The advocate also raised the issue that the Original Adjudicating Authority had not provided the relied upon documents due to the non-filing of Vakalatnama by the advocate. It was requested that the Authority be directed to supply the relied upon documents when remanding the matter.
Judgment:
The Tribunal considered the submissions and noted that a similar matter had been remanded previously on the same issue. Therefore, it was decided that the present matter also needed to be remanded. The request for supply of documents was deemed reasonable, and it was directed that the Original Adjudicating Authority should decide the liability for rebate and penalty separately for each individual. Additionally, the Authority was instructed to supply the relied upon documents before passing the order, and the appellants were to be given a proper opportunity to present their case before the final decision was made.
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2010 (1) TMI 1159
The Allahabad High Court, in the case of Amreshwar Pratap Sahi, allowed the writ petition and quashed the order dated 19.12.2009, as the petitioner was found to be identically situated as others whose impugned orders were already quashed by the Court due to a mistake in absence of a report.
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2010 (1) TMI 1158
Issues involved: Interpretation of Foreign Trade Policy and Exemption Notification for 100% EOU, calculation of clearances to domestic tariff area, invocation of extended period for duty demand, penalty imposition, similarity of goods exported and cleared domestically, categorization of dyes, proper annexure to show cause notice, remand for fresh decision.
Interpretation of Foreign Trade Policy and Exemption Notification: The Appellant, a 100% EOU, was permitted to clear 50% of dye quoted quantity into the domestic tariff area u/s para 6.8 of Foreign Trade Policy and Exemption Notification No.23/2003-CE dated 31.3.2003. The department invoked the extended period for duty demand and penalty imposition based on the view that clearances should be calculated for each dye separately, relying on customs valuation rules for defining similar goods exported and cleared domestically.
Invocation of Extended Period: The Commissioner took the view that the extended period should be calculated from the end of the financial year. However, the Tribunal, based on a previous case, held that the extended period is not invokable in this scenario due to similarities in facts such as filing of returns, submission of documents, and permissions from the Development Commissioner.
Categorization of Dyes and Similarity of Goods: Unlike the previous case involving Agro Chemicals, in this case, there was no categorization of dyes for eligibility determination, and details were not available. The Tribunal emphasized the need for a discussion on each item to determine why the benefit of the notification cannot be extended, requiring a remand for a fresh decision by the Commissioner.
Proper Annexure to Show Cause Notice: The Appellant argued that there was no proper annexure to the show cause notice, making it difficult to identify whether the demand by the department was in respect of the same goods. The Tribunal, considering the lack of clarity, waived the pre-deposit requirement, allowed the stay petition, and remanded the matter to the Commissioner for a fresh decision after considering submissions from the Appellants.
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2010 (1) TMI 1157
Condonation of delay - delay in filing review petition - Held that: - no case for review of our order is made out both on the grounds of delay as well as on merits and accordingly the review petition is dismissed - decided against petitioner.
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2010 (1) TMI 1156
Whether the court is empowered to hand over the investigation to an independent agency like the CBI even when the charge sheet has been submitted?
Whether the investigation concluded in the present case cannot be said to be satisfactorily held?
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9911796707
